TMI Blog2022 (8) TMI 675X X X X Extracts X X X X X X X X Extracts X X X X ..... he impugned order passed by the ld. Commissioner. Decided in favour of assessee. - I.T.A. No. 130/KOL/2021 - - - Dated:- 3-8-2022 - Shri Rajpal Yadav, Vice-President (KZ) And Shri Girish Agrawal, Accountant Member For the Assessee : Shri Siddharth Jhajharia, FCA For the Revenue : Shri Deba Kr. Sonowal, CIT (DR) ORDER PER RAJPAL YADAV, VICE-PRESIDENT (KZ): - The assessee is in appeal before the Tribunal against the order of ld. Principal Commissioner of Income Tax (Central), Kolkata-2 dated 24.03.2021 passed for the assessment year 2010-11 under section 263 of the Income Tax Act. 2. Brief facts of the case are that the assessee has filed its return of income under section 139(1) of the Income Tax Act on 09.10.2010 declaring total income of Rs.18,85,80,920/-. This return was revised by the assessee. Assessment order under section 143(3) was passed on 26.03.2013. Thereafter a search was carried out upon Salarpuria Group on 15.03.2016 under section 132 of the Income Tax Act. A notice under section 153A of the Income Tax Act was issued and served upon the assessee. In response to the notice, the assessee has filed its return electronically declaring t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailable in paragraph no. 4.6. For a ready reference, we would like to note the finding, which reads as under:- 4.6. After hearing the rival contentions and perusing the materials on record as placed before us, we note that search was conducted on 15.03.2016 on Salarpuria Group of companies including the assessee and its Directors. It is undisputed that the assessment was framed in the instant assessment year vide order dated 26.03.2013 and thus it had attained finality on date of search and would be an unabated assessment on the date of search in terms of provisions of section 153A of the Act. It is settled legal position that in order to make addition in an unabated assessment on the date of search, there has to be incriminating material found during search as laid down in various decisions as cited by the assessee s counsel supra. After carefully analyzing the facts of the acts and after the perusal of assessment order, we find that there is no reference at all by the AO to any such incriminating material found during search. The various additions were undisputedly made on the basis of observation of the AO during search. The additions made inter alia include disallowance u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 144A; (ii) an order made by the Joint Commissioner in exercise of the powers or in the performance of the functions of an Assessing Officer conferred on, or assigned to, him under the orders or directions issued by the Board or by the Chief Commissioner or Director General or Commissioner authorized by the Board in this behalf under section 120; (b) record shall include and shall be deemed always to have included all records relating to any proceeding under this Act available at the time of examination by the Commissioner; (c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the Commissioner under this subsection shall extend and shall be deemed always to have extended to such matters as had not been considered and decided in such appeal. (2) No order shall be made under sub-section (1) after the expiry of two years from the end of the financial year in which the order sought to be revised was passed. (3) Notwithstanding anything contained in sub-section (2), an order in revision under this section may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT in the case of Mrs. Khatiza S. Oomerbhoy Vs. ITO, Mumbai, 101 TTJ 1095, analyzed in detail various authoritative pronouncements including the decision of Hon ble Supreme Court in the case of Malabar Industries 243 ITR 83 and has propounded the following broader principle to judge the action of CIT taken under section 263. (i) The CIT must record satisfaction that the order of the AO is erroneous and prejudicial to the interest of the Revenue. Both the conditions must be fulfilled. (ii) Sec. 263 cannot be invoked to correct each and every type of mistake or error committed by the AO and it was only when an order is erroneous that the section will be attracted. (iii) An incorrect assumption of facts or an incorrect application of law will suffice the requirement of order being erroneous. (iv) If the order is passed without application of mind, such order will fall under the category of erroneous order. (v) Every loss of revenue cannot be treated as prejudicial to the interests of the Revenue and if the AO has adopted one of the courses permissible under law or where two views are possible and the AO has taken one view with which the CIT does not agree. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns while allowing the entire expenditure as revenue expenditure. However, that by itself would not be indicative of the fact that the Assessing Officer had not applied his mind on the issue. There are judgments galore laying down the principle that the Assessing Officer in the assessment order is not required to give detailed reason in respect of each and every item of deduction, etc. Therefore, one has to see from the record as to whether there was application of mind before allowing the expenditure in question as revenue expenditure. Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between lack of inquiry and inadequate inquiry . If there was any inquiry, even inadequate, that would not by itself, give occasion to the Commissioner to pass orders under section 263 of the Act, merely because he has different opinion in the matter. It is only in cases of lack of inquiry , that such a course of action would be open . 10. In the case of Gee Vee Enterprise vs. Commissioner of Income Tax reported in 99 ITR page 375, the Hon ble court has expounded the approach of ld. Assessing Officer while passing assessment order. The obs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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